Comparison of Analysis Deviation Methods for the Multiplicative Operations
Comparison of Analysis Deviation Methods for the Multiplicative Operations

Author(s): Barbora Ptáčková, Dagmar Richtarová
Subject(s): Business Economy / Management, Methodology and research technology, Accounting - Business Administration
Published by: Masarykova univerzita nakladatelství
Keywords: financial performance; analysis of deviations; pyramidal decomposition; return on equity;
Summary/Abstract: This paper is dedicated to comparison of analysis deviation methods for the multiplicative operations. Evaluation of financial performance belongs to key activities of each company. The importance of the performance concept is widely recognized, it is one of the tools, knowing which helps to manage a company efficiently. Decomposition analysis is also very important. Decomposition analysis helps to analyze the factors affecting selected key measures and quantify their impact on the key measures. In this paper five basic methods of analysis of deviations will be compare – gradual change method, decomposition method with a residue, logarithmic method, functional method and integral method. The aim of this paper is to compare analysis deviation methods for the multiplicative operations used for quantification of the influence of the component indicators to base indicator and verify if using of these five methods leads to the same results. Methods of analysis of deviations will be applied to return on equity (ROE) indicator of manufacturing industry of the Czech Republic and according these five methods main factors will be find and influence of these factors will be quantified. Annual data will be taken from Ministry of industry of the Czech Republic.

• Details
• Contents